Welcome to the inaugural issue of “Conversations with Friends,” a blog focused on the enlightening and entertaining conversations I have with an assortment of accomplished professionals, thought leaders, and game changers. And yes, they are my friends, and I am very proud of them. But, way beyond that, these are bright people with genuine passion and great insights that I want to share with others. Through our discussions, I hope to present a bird’s eye into the unique nuances and points of view that make these conversations really interesting.

The idea for came to me after an engaging conversation with my friend Victor (who was interviewed for this story). As we were talking, I thought: “Wow! So many people would really benefit from hearing this conversation.” And thus, an idea was born.

So who is Victor and what is this story about? The long and short of it … Healthcare Insurance. Yes! That’s the topic … but no, please … stay with me. It might seem like it’s not that interesting, but really it is. Why? Firstly, everyone is talking about it. Most of us are frustrated, confused, or just upset at with all the commotion around insurance, “Obamacare,” etc., and we all know that health insurance is a must. Plus, we are now inundated with a flurry of consumer messages, similar to what we see during a political race, that only add to the collective head-scratching. Figuring it out and finding the best option—not easy. So how does Victor play into this? Well, we happen to bump into each other a few weeks ago and ended up getting lunch together. Here’s our conversation:

Hilarie: I have known for a while now that you’re in healthcare, but haven’t known what your role was. So what is it, exactly, that you do?

Victor: I’m a healthcare consultant and project/program manager specializing in the healthcare insurance space (also known as the “payor” space).

Hilarie: Very interesting. You are an Ivy-league educated young man who I am sure had many options when choosing an occupation. What motivates you, and why did you choose this career path?

Victor: I’m excited about this work because the insurance industry (theoretically) grants access to medical care and a quality of life that most people could never afford on their own. Most people don’t think of insurance like that because the industry has such a ragingly awful reputation, but changing that reputation is one of my main goals.

Hilarie: How would you describe the biggest/bigger issues with healthcare insurance?

Victor: As I see it, the two biggest problems in the payor space are 1) unengaged consumers, and 2) untapped big data on consumers.

Firstly, unengaged consumers drive every major problem the insurance industry faces today. Overly complex plans and unclear usage directions make folks feel victimized and resentful, leading to increased political will for heavier insurance regulation that drives up payors’ baseline costs to react to the new regulations. With payors at the center of the healthcare ecosystem (that’s where I sit), they have the biggest potential to reshape the hulking financial mass of $3 trillion that circulates in this industry every year. That transformation begins by attracting fresh talent and prioritizing simplicity and transparency (which should be driven by the self-awareness that consumers are and have always been revolted by insurers). Venture capitalists are getting in on this industry transformation with Oscar and Clover offering improved payor experience and Picwell and HoneyInsured offering customized health plan recommendations to customers, and the larger insurers will be ramping up in the next 12–18 months their efforts to compete with these newer entrants.

Secondly, untapped big data on consumers, specifically real-time consumer health data, prolongs the unrealized potential of the payor space to push the entire healthcare industry into ambitious new territory. For example, wouldn’t it be great if your insurer gave you the option to share your Fitbit data in real time, such that every additional calorie you burn is an additional penny that comes off the next month’s premium? (Oscar’s attempting to do a version of this at the moment, but they still aren’t leveraging as much data as they could.) At the moment, consumers have minimal incentive to reduce their risks on a daily basis through simple behavior changes, and insurers are really the only players in the healthcare space who are in a financial position to benefit directly from consumers’ direct involvement in these measurable, financial incentives for behavior changes.

Hilarie: Why do you think it’s so complicated?

Victor: Insurers and their actuaries have created this byzantine system for assessing and managing risk: they’ve attempted to account for the finances and “fairness” of every type of medical scenario. This particular philosophy in insurance has a cruel, Shakespearean irony: the minimum complexity needed to account for the finances and “fairness” of every medical scenario is far, far higher than the maximum tolerable complexity for consumers attempting to use their insurance. There are only two possible ways address this underlying problem in the industry:

1. We completely abandon this philosophy and move toward medical-necessity agnosticism, e.g., if you want to get a breast augmentation, then have a blast and we’ll pay for it, or
2. We maintain the current complexity, but we dramatically improve our communication with members so that they are always aware of and engaged in every financial decision related to their care.
3. I think both approaches have their merits, but I think the second option is more likely to be implemented in the near term. To me, the greatest accomplishment of this new system would be the new ability to confidently and accurately tell patients in 100% of their clinical visits exactly what they can expect to be charged. The fact that we can’t do that at the moment is one of the greatest embarrassments of the current system.

Hilarie: What are the insurers doing to help their customers?

Victor: Frankly, most insurers aren’t doing much. They make minor improvements here and there, but almost none of the improvements are creating any measurable shift in addressing the problems I’ve outlined above. How do I know? Ask anyone on the street—or even ask a hundred people on the street—how informed they felt at their last doctor’s visit or surgery about how much they would be expected to pay. I would venture to guess that you won’t find anyone informed enough to speak confidently (and accurately) about their insurance and medical bills. Insurance insiders congratulate themselves on all the progress they think they’ve made in engaging consumers, but this self-congratulation is wildly misaligned with the reality that most people, even highly educated people, are totally alienated by the insurance industry status quo.

Hilarie: What are common concerns with healthcare insurance from the insurers POV?

Victor: The insurers are always fighting the battle of remaining compliant with state and federal laws, regulations, and guidances. Because they’re so swamped with ensuring compliance, almost none of them are focused on dramatically improving consumer involvement and perception. This is the vicious cycle: for as long as consumers remain unhappy, new laws/regulations will be passed, thereby diverting insurance executives’ attention (and annual budgets) away from addressing consumers’ needs and thus extending consumer unhappiness (and subsequently precipitating new laws/regulations).

Hilarie: If you could let consumers in on one little nugget of information, what would it be?

Victor: Every dollar you’re charged for care is connected to a specific “procedure” your doctor/nurse/chiropractor/etc. administers. Even just seeing a doctor to chat about something (even if the doctor never looks at or touches you) is still considered a procedure, and every procedure has a “procedure code.” If you really want to get an iron-fisted control over your medical expenses/bills, follow these steps:

1. Call your doctor’s office ahead of time, and request:
   1. a list of the procedure codes that the doctor will likely perform during your visit for the kind of issue you’re having, and
   2. the NPI number that their office staff will use to bill the insurance company (this is the special number that either your doctor or the facility uses to identify themselves to insurers)
2. Call your insurer, give them the procedure codes and the NPI number, and ask the agent to give you a detailed breakdown of what you would have to pay, to whom you have to make the payment, and when you have to make the payment in that scenario (with those procedures and that NPI number).
3. Ask the agent for their name and ask the agent to provide you a unique identifier for the conversation if you ever need to retrieve the recorded version (e.g., you need the recorded version of the conversation if your doctor or insurance company tries to charge you way more than they said they would).
4. At the beginning of your doctor’s visit, explain that:
   1. you’re trying to keep your medical expenses under control,
   2. you have a list of the procedure codes with you that she/he would likely perform,
   3. you’ve researched you the amount you would have to pay for each of them, and
   4. before she/he begins any procedure that is not on your list, she/he needs to give you the name and code for that procedure along with a ballpark estimate of the cost

While this process is incredibly unwieldy and has lots of exceptions, it’s the most effective way to control your expenses in the current system. And yes, it’s very, very embarrassing to admit that this is the current state of the industry.

Towards the end of our conversation, and now knowing that Victor is immersed in a field that so many of us are trying to understand, I was trying to get a sense from him about the future, or better yet, how the situation might improve between health insurance companies and their clients (us). As there seems to be no easy answer, yet we all still need to rely on these companies to provide us with a literally life or death service.

Hilarie: I find that the more I talk to you, the more I want to understand what could happen that would make this better? Obviously, I am in the brand/marketing/communications space, but I’m not sure this can be fixed with a refreshed image. That being said, the companies you mentioned, like Oscar, do have a much more consumer-friendly brand personality. Do you think those new entrants will, in fact, change the game?

 Victor: I’m hesitant that they will. The process that I just explained is the only way to truly maintain a tight control over medical expenses and over expectations, and the companies I mentioned aren’t really encouraging their consumers to get into that level of detail. The kind of innovation that I would like to see would look something like this.

1. Someone feels bad, so they decide to go to the doctor.
2. They arrive at the doctor’s office, and start explaining their problems in the exam room to the doctor.
3. There’s a screen in the exam room that faces both the patient and the doctor that shows:
   1. the patient’s name and insurance information,
   2. the procedures (and their codes) the patient is currently receiving and how much the patient will be responsible to pay, and
   3. the proposed procedures the doctor would like to perform along with the amount the patient will be responsible to pay
4. The patient would “accept” or “reject” each proposed procedure (based on its description and end cost) before any procedure begins.

While there’s so much I want to see in the future, I think that this simple concept would yield the biggest progress in the shortest period of time. We desperately need the marketing world to help us simplify the communication of all this information to consumers so that they can digest it and truly become active consumers via a real consumer-facing pricing and payment model. From there, we let the market do the rest.

Thank you for reading the first installment of Conversations with Friends. I hope you enjoyed it or, at the very least, learned something that provided a different point of view.  Until next time…

Victor Galli is a healthcare consultant who works in Philadelphia, New York, and DC and specializes in insurance. He was born and raised in Dallas, TX before moving to the Northeast in 2008 to attend the University of Pennsylvania, where he studied life science and history. After graduation, he worked at the Wharton School as a researcher before eventually moving into the consulting industry in early 2014. Victor’s primary passions outside of his professional work are city planning, architecture, real estate, history, food science, and design.

Hilarie S. Viener is Founder of Viener&Partners, a brand and marketing consultancy based in Manhattan. Her career has afforded her to work with over 100 brands from start-ups to Fortune 100’s.  Her prior experience includes roles as Executive Vice President, North America of The Value Engineers, global brand consultancy and President of branding and digital agency, WONDER. Ms. Viener is a graduate of American University’s School of Communication in Washington, DC.  She began her career at Wells Rich Greene Advertising, then moved on to roles at Griffin Bacal, Lowe & Partners and BBDO.

To find out more, please go to www.vienerandpartners.com